Securities Law of Malaysia

by Thomas Sim, 26 Mar, 2001

What are the securities laws of Malaysia?

According to Securities Commission Act 1993, the followings are securities Law in Malaysia:

(1) Securities Commission Act 1993 (SCA)
This Act covers the activities of listed companies in listing, prospectuses and disclosure of information as a whole.

(2) Securities Industrial Act 1983 (SIA)
This Act covers the manners in which securities are traded in Malaysia.

(3) Securities Industrial (Central Depository) Act 1991
This Act governs the Central Depository Sdn Bhd and the scripless trading of securities in Malaysia.

Related Laws in the Derivative Market

Futures Industry Act 1993 (FIA)
(not a securities law under SCA 1993)
This Act governs the trading of futures and options in Malaysia. Futures are traded in KLOFFE. Currently the only futures traded is on Composite Index of the KLSE. It was introduced in Dec, 1995. This was followed by KLOFFE's second product, the KLSE CI Options contracts in December 2000.

Some Background

By old definition, the Companies Act 1965 is also a securities law as it governs companies out of the areas of Securities Industrial Act 1983 and Securities Commission Act 1993. Nevertheless, it is still the backbone in statutes related to regulation of private companies (Sendirian Berhad companies), therefore it is not part of the law under the enforcement of the Securities Commission (SC).

Companies Act 1965 is the main stair of law governing private companies under the enforcement of Registrar of Companies (ROC).

Relevance of securities law of Malaysia to ICSA Examination

The Professional Stage papers on Malaysian Corporate Law (MCL) and Malaysian Company Secretarial Practice (MCSP) are primarily designed to assess candidates of ICSA on the Companies Act 1965. In my opinion, there will be more emphasis on SCA and SIA in future examinations as company secretaries are heavily involved in listed companies.